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IASB creating forum; FASB extends private company comment deadline

The International Accounting Standards Board (IASB) is proposing the
creation of a 12-member forum of national standard setters and
regional bodies.

In an Invitation
to Comment (ITC) issued Thursday, the IASB proposed that the
Americas, Asia-Oceania and Europe each should get three automatic
seats on the forum, which will provide technical advice and feedback
to the IASB and will be known as the Accounting Standards Advisory
Forum (ASAF).

Africa would get one automatic seat, and the remaining two seats
would be at-large.

The ASAF is being created to facilitate a more streamlined and
effective dialogue between the IASB and the standard setting community.

The ITC is available on the IASB’s website. Comments are due Dec. 17.

Private company framework

In other financial reporting news announced Thursday, FASB extended
its deadline to Nov. 9 for comments on its private company decision
making framework.

The original deadline on FASB’s
Invitation to Comment was Oct. 31, but FASB Chairman Leslie
Seidman said in a statement that the extension will accommodate
stakeholders who want to comment but have been affected by Hurricane Sandy.

FASB is developing the framework to create criteria to help the
board and the newly formed Private Company Council identify when
modifications and exceptions to standards should be developed for
private companies.

“This will give everyone an opportunity to communicate their views,
while providing the staff sufficient time to present its findings for
deliberation by the Private Company Council and FASB at the PCC’s
first public meeting on December 6,” Seidman said in a statement.

FASB drafting impairment ASU

FASB’s staff has been directed to draft a proposed Accounting
Standards Update (ASU) on impairment of financial instruments that
will contain a credit impairment model that differs from the one the
IASB is using.

During a meeting Wednesday, FASB discussed the remaining issues
related to its newly developed Current Expected Credit Loss (CECL)
model, according to a
summary of board decisions posted on the board’s website. FASB
decided that when drafted, the ASU would reduce financial reporting
complexity relating to the measurement of expected credit losses.

The board instructed the staff to prepare an ASU to present to FASB
for a formal written ballot.

Because of concerns from stakeholders, FASB retreated in
July from the so-called “three-bucket” credit impairment model it has
been developing in the financial instruments convergence project with
the IASB. The CECL model FASB developed uses a single measurement
objective – current estimate of expected credit losses – rather than
the dual-measurement approach used in the three-bucket model.

The agenda for both boards includes a fourth-quarter release of EDs
on impairment of financial instruments.

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